Retail Forex Trading Platform To Launch In August, Says RBI

The long-awaited retail foreign exchange trading platform is set to be launched in early August, the Reserve Bank of India said in a notification on Thursday.

An electronic platform for retail forex trading has been in the works for some time now to address concerns about mispricing by banks.

“The issue of transparent and fair pricing for retail users (individuals and micro, small and medium enterprises) in the foreign exchange market has been raised in various fora and in public interactions. Such a mechanism will provide transparency while enhancing competition and lead to better pricing for retail customers,” the RBI said while announcing August 5 as the launch date for the platform.

According to the rules for this platform:

• It can be accessed by any customer of a bank.
• Customers can purchase or sell U.S. dollar against the rupee for delivery on cash basis (same day), tom basis (next day) or spot basis (two days after date of transaction) .
• There is no cap on the number of transactions per customer.
• The size of a single transaction is not allowed to exceed $5 million.
• No transaction charges shall be levied by Clearing Corporation of India Ltd. on transactions upto $50,000 per day.
• Transaction charge of 0.0004 percent to be levied on transaction of more than $50,000 per day.
• Fees charged by banks, if any, shall be indicated on the FX-Retail platform.

The RBI further asked banks to try and speed up registration of retail clients on the platform. “In view of the advantages of transparency and pricing to retail customers, as well as the systemic advantage of improved price discovery, banks shall facilitate on-boarding of retail customers to the platform expeditiously,” the central bank said.